September 14, 2020
Main Event Entertainment Group Limited (MEEG) for the nine months ended July 31, 2020 recorded a total of $944.59 million in revenue compared to $1.36 billion booked for the period ended July 31, 2019, a 31% decrease year over year. Revenue for the quarter declined drastically by 87% to close the quarter at $59.78 million relative to $468.61 million booked for the corresponding period in 2019.
Direct expenses for the nine months decreased 31% year over year to $521.30 million relative to $760.84 million recorded in the prior corresponding period. Gross profit for the period thus reduced by 30% to $423.29 million (2019: $603.61 million). Gross profit for the quarter decreased 79% from $197.83 million in 2019 to $40.57 million. MEEG booked other income of $530,000 for the nine months, $13.63 million lower than the prior year’s corresponding period of $14.16 million.
Total expenses declined by 18% to $403.25 million versus $491.86 million recorded for 2019. Of this, administrative and general expenses fell 24% to $299.99 million (2019: $395.73 million), while depreciation expense increased 14% to $94.78 million (2019: $83.46 million). Selling and promotion expense declined by 24% to $8.47 million relative to $12.66 million booked last year. Total expenses for the quarter amounted to $83.50 million, 54% lower relative to last year’s comparable quarter of $182.19 million.
Consequently, operating profit for the period declined 84% to $20.57 million (2019: $125.90 million). Operating loss for the quarter amounted to $42.78 million versus a profit of $23.16 million booked July 2019.
Finance cost year over year, decreased by approximately 30% to $12.46 million (2019: $17.81 million) at the end of July 2020.
MEEG recorded profit before taxation of $8.11 million, a significant reduction of 92% when compared to last year’s corresponding period of $108.09 million. However, loss before tax for the quarter closed at $47 million relative to a profit of $14.73 million.
The company reported tax credit of $562,000 during the period, resulting in net profit totalling $8.67 million, a 92% decrease year over year (2019: $108.09 million). MEEG reported net loss of $45.54 million for the third quarter versus a profit of $14.73 million for the comparable period in 2019.
Earnings per Share (EPS) for the nine months amounted to $0.03 (2019: $0.36), while for the quarter the company booked a LPS of $0.15 relative to an EPS $0.05 in 2019. The trailing LPS amounted to $0.01. The number of shares used in the calculation was 300,005,000 units. Notably, MEEG stock price closed the trading period on September 11, 2020 at a price of $3.50.
MEEG noted, “Our results for this quarter and for the nine-month period ended July 31, 2020 have been significantly impacted by the on-going global pandemic.” Also “We have been Challenged to weather a very unfavourable environment for our industry, with government imposed social distancing protocols and shutdown of outdoor events. As a result, both revenues and profitability have retracted significantly.”
Balance Sheet Highlights:
As at July 31, 2020, the company’s assets totalled $848.69 million (2019: $1.06 billion), $211.59 million less than its value a year ago. This decrease in total assets was largely driven by a decrease in ‘Receivables’ which declined by 80% or $330.03 million year over year to $75.11 million (2019: $375.14 million). ‘Due from related companies’ also contributed to the downward movement with a 66% decrease from $44.06 million booked as a July 31, 2019 to $14.80 million.
Equity attributable to stockholders of the company amounted to $560.51 million (2019: $631.08 million). This translated to a book value per share of $1.87 relative to $2.10 for the corresponding period in 2019
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